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Court sides with YouTube for second time in major Viacom copyright case

Jeff John Roberts — Thu, 18 Apr 2013 22:30:28 +0000

A New York court has again rejected claims that YouTube should be held accountable for unauthorized videos that appeared on the site during its early years of operation.

In the latest twist in a long and closely-watched copyright case brought by Viacom, U.S. District Judge Louis Stanton granted summary judgment to YouTube after finding executives at the video site did not have “red flag” knowledge that made them liable for content uploaded by users.

The ruling comes one year after the Second Court of Appeals reversed Stanton’s earlier decision in 2012 to dismiss the case, and ordered the judge to revisit his ruling in light of emails that suggested the YouTube founders had knowledge of copyright infringement. In his new decision, issued on Thursday Stanton rejected Viacom’s legal theory as “extravagant” and stated that “its foundation is an anachronistic [...] concept.”

On its surface, the case turned on whether YouTube had to pay damages to Viacom for thousands of unauthorized clips of shows like South Park and Seinfeld that appeared on the site. But on a deeper level, the case is significant because it is helping to determine what digital technology companies must do to protect copyright.

Under a law known as the DMCA, online services like YouTube are not responsible for the copyright infringement of their users. The law, which was crafted to ensure that new digital platforms didn’t get smothered by copyright claims, grants “safe harbors” to sites provided they provide a way for owners to take down their content, and so long as the site is not complicit in users’ copyright violations.

Viacom and the entertainment industry, which believes that YouTube have unfairly profited from copyrighted content, had hoped to shrink the scope of the “safe harbors” by drawing attention to the DMCA’s so-called “red flag” provision — a part of the law that means a site is liable if those controlling it are willfully blind to copyright violations.

In deciding to reinstate the case, the appeals court agreed that YouTube was not responsible for most of the clips for which Viacom was claiming over $1 billion dollars. However, it said the potentially incriminating emails required the lower court to examine if YouTube knew or should have known about specific pieces of infringing content.

In the new decision Stanton said Viacom, in its legal arguments, had conceded that it was unable to identify specific examples of specific copyright clips of which the YouTube founders should have been aware. He added that Viacom had tried to solve the situation by claiming that it was YouTube’s responsibility to show they did not know, but that this was a misinterpretation of the law.

Viacom is entitled to appeal Stanton’s decision a second time but its safe harbors argument may be running out of steam. In a similar case involving defunct video service, Veoh, a California appeals court emphatically concluded that the safe harbors applied.

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Connected consumer first-quarter 2013: Analysis and outlook

Fri, 12 Apr 2013 22:46:59 +0000

Many long-standing legal rules of engagement between publishers and consumers tilted the playing field in unexpected ways in the first quarter. The period also saw a major expansion in the amount and quality of original productions for web-based video platforms and a major move by chipmaker Intel to stake a claim in the digital living room.

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Cablevision sues Viacom to break up the bundle — or get a better deal

Janko Roettgers — Tue, 26 Feb 2013 18:31:13 +0000

Cablevision has filed a federal antitrust lawsuit against Viacom in New York Tuesday in an attempt to break up the bundle of channels that Viacom is selling the cable operator. Cablevision’s lawsuit alleges that Viacom is forcing the operator to carry 14 networks it and its customers don’t want, including MTV Hits and VH1 Classic.

The operator now wants to invalidate a deal the two parties struck just two months ago, and instead just get the good stuff. You know, Comedy Central, Nickelodeon, and maybe a little bit of MTV proper.

Cablevision sent out the following statement about the lawsuit:

“The manner in which Viacom sells its programming is illegal, anti-consumer, and wrong. Viacom effectively forces Cablevision’s customers to pay for and receive little-watched channels in order to get the channels they actually want. Viacom’s abuse of its market power is not only illegal, but also prevents Cablevision from delivering the programming that its customers want and that competes with Viacom’s less popular channels.”

A Viacom spokesperson sent us the following statement in response:

“At the request of distributors, Viacom and other programmers have long offered discounts to those who agree to provide additional network distribution. Many distributors take advantage of these win-win and pro-consumer arrangements. Reflecting the highly competitive cable programming business, these arrangements have been upheld by a number of federal courts and on appeal. Viacom will vigorously defend this transparent attempt by Cablevision to use the courts to renegotiate our existing two month old agreement.”

The lawsuit also alleges that Viacom threatened “massive financial penalties” if Cablevision refused to carry the 14 lesser-watched channels in question. The operator is asking for a permanent injunction that would bar Viacom from bundling its lesser-watched channels with its more popular core offerings.

On paper, this lawsuit is an interesting challenge to the cable bundle, which has been largely dictated by the broadcasters. Operators have long said that they would like to sell their customers smaller and more flexible bundles. Broadcasters have made this impossible by either directly bundling all their channels into one big package, or by other conditions that make sure operators can’t sell bundles without certain channels.

However, it’s unlikely that this lawsuit will be fought out until the bitter end. Because at the core, this is about something else: Broadcasters have in recent years significantly increased the carriage fees for their fares, leading to a number of nasty fights that left consumers without their favorite channels for weeks. In the end, content owners always won, and carriers caved in, agreeing to pay more before their customers have yet another reason to cut the cord.

Cablevision and Viacom negotiated a last-minute carriage agreement in late December. Details of that deal were not made public, but it’s obvious that Cablevision wasn’t happy with the outcome. Now it wants to get a better deal, and threatening the bundle is the biggest asset it has in this fight.

Image courtesy of Flickr user nyghtowl.

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Connected consumer third-quarter 2012

Thu, 18 Oct 2012 06:55:33 +0000

The third quarter saw many parts of the traditional media business in flux. New digital platforms that once had confined themselves to user-generated content began to invest in creating professional-quality content. At the same time, TV programmers began to wrestle with both the threat and the opportunity presented by second-screen and social-TV platforms. The period also saw the rollout of new device-based content ecosystems, red flags and red ink for traditional consumer electronics makers, and a resurgence of consumer purchases of movies. This quarterly wrap-up discusses these developments as well as offers trends and topics to watch for the remainder of 2012 and beyond.

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